Response to the following problem:
The equity section of Webster Corporation's balance sheet shows the following.
Preferred stock-5% cumulative, $10 par value, $15 call price, 10,000 shares issued and outstanding . . . . . . . . . . . . . . . . . $100,000
Common stock-$10 par value, 55,000 shares issued and outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 550,000
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267,500
Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $917,500
Determine the book value per share of the preferred and common stock under two separate situations.
1. No preferred dividends are in arrears.
2. Three years of preferred dividends are in arrears.